A new generation of large hydroelectric dams and smaller plants across the Highlands could produce enough clean energy for more than half a million homes, a ministerial taskforce has estimated.

A report published today by Scottish ministers suggests that up to 128 new dams and scores of smaller schemes powered by the natural flow of a river could be built across the western and southern Highlands, generating enough electricity for a quarter of Scotland's homes. Scottish executive officials said this would be a "significant step forward" to meeting the Scottish National party's ambitions of generating half the country's electricity from renewable sources by 2020.

Yesterday, water began flooding into the reservoir for the largest new hydro scheme to be built in a generation after the first minister, Alex Salmond, ceremonially closed a sluice gate at Glendoe, a 200 megawatt scheme buried under a mountain near Loch Ness.

The report is due to be presented today by the Scottish energy minister, Jim Mather, who expects it will greatly boost the SNP's claims that Scotland can become the "Saudi Arabia of renewable energy" - a claim based on the country's significant natural wind, wave and tidal power resources.

The report estimates these new dams could increase Scotland's hydro-power output by 50%, taking it to more than two gigawatts and potentially meeting a quarter of the estimated 8GW of renewable energy needed to meet the 2020 target.